Octane Capital launches with bespoke 'price to risk' policy

According to the lender, it will not offer a product sheet with set rates determined by LTV. Instead, each loan application will be structured on a highly bespoke basis and priced according to risk.

Octane has confirmed that it will focus on complex, non-standard and larger loans that brokers may struggle to place with other lenders and will lend across residential and commercial bridging, bridge-to-let and bridge-to-sell, heavy and light refurbishment as well as development finance (from Q3 2017).

Octane Capital will lend from as little as £100,000 up to £25m and well beyond. It is open to applications from every kind of borrower, from individuals, partnerships and limited companies to foreign nationals, expats, offshore companies and trusts.

As a third generation lender, Octane Capital will also move away from transactional lending to a partnership model where it will work closely with brokers and master brokers — its core introducers — to help their clients achieve their goals. Providing certainty of lending to brokers will be fundamental to everything Octane does.

Jonathan Samuels, CEO, Octane Capital, commented: "Bridging has changed significantly since I first entered the market back in 2009, with ever lower LTV-based pricing the dominant narrative. But for us, this is misplaced. Rather than be constrained by a restrictive price to LTV matrix, we’ve decided to price for risk, which means no set product sheet. That’s what authentic bridging was always about but in many corners of the industry it seems to have been forgotten. Our goal is to return bridging to its roots while retaining the professionalism and transparency that have emerged since 2009. It’s what we’re calling the third generation of bridging – the best bits of the two previous generations combined.”

Mark Posniak, Managing Director, Octane Capital, added: “Octane is definitely not Dragonfly Part Two. Bridging has changed beyond recognition in the past eight years and we sensed the need to change with it. Having looked at the market, we felt the current trend of low margin, high volume lending — pricing on LTV and LTV alone — is a dangerous game that won’t end well. Instead we’re going to focus on complex loans that the growing ranks of vanilla lenders shy away from because they are out of their comfort zones. It’s in large and non-standard loans that we feel we can add the most value — and to that end we’re keen to take on the most complex loans the market can throw at us.”